Research Proposal Analyzing the Efficiency of Customer Reward

Question: Discuss about theResearch Proposal for Analyzing the Efficiency of Customer Reward. Answer: Introduction: It has been observed that the evolution of supermarket shopping has increased at an expediential rate over the past few years. There has been a significant change in the ways in which people used to shop in the earlier days and at present. The retail companies are not only focused upon satisfying its customers with wide range of quality and affordable products and services but also try to facilitate them with added value and in this process they tend to enter into tie ups of with wide range of other companies and service providers where the customers by shopping more and more at the retail stores can easily avail the added services (McCall and McMahon, 2015). This has been made possible with the help of the customer loyalty programs and cards. Moreover, the trend and the interest on the part of the customers towards using the loyalty cards is also undeniable and this clear by the figure that around more than 85% of the households in UK has at least one active loyalty card (Plimmer, 2010). On the other hand, these loyalty cards are not only used to offer added value to the customers, rather these loyalty cards can be looked upon as one of the most important marketing strategies of the company since it provides an opportunity to the marketers to directly interact with customers and also keep a track of the changing trends and habits in the buying behavior of the customers. Thus the researcher in the present study would strive towards analyzing the efficiency of the customer reward program as a marketing tool especially in the context of Tesco Plc which is not only the largest grocery retailer in UK but also worlds most successful internet supermarket (Tesco plc, 2015). This part of the study includes the lietarure review, the research questions and hypotheses, operational definitions and measurement, research methodologies, research process, expected outcomes and conclusion. Literature Review The studies conducted by Humby et al., (2003) reveal the fact that loyalty programs can be referred to as a marketing strategy which is based upon the fact of offering an incentive to secure the loyalty of the customers to the retailer. In this process, the achievement of reward is directly related to the frequency of purchase and so it can also be referred to as the frequent purchase programs. Emphasizing upon the loyalty programs popularity, Plimmer, (2010) put forward the fact that in UK there are currently over 150 such loyalty schemes and there have been several cases where the loyalty program schemes have failed rather than succeeded. Thus it can be said that to determine the success of the reward program, it is not an easy task since it tends to depend upon the goals that were set by the by the marketers and so there are various factors that tend to play a role in flouncing the target market. Moreover, the preferences of the customer change with time and it also tends to change when they are being exposed to promotions, advertisements and the loyalty programs. In this context, Shin and Sudhir, (2011) emphasized upon the fact that consumers prefer to participate in the programs that are perceived by them as capable of offering equitable relationships and thus their decision towards participating in the loyalty programs mainly depends upon their perception towards the fairness. However, in this context, it has been commented by Stone, (2003) that Tesco is the largest supermarket retailer in UK and it might be the fact that the company has been successful in achieving this position without the clubcard, but it would not have been possible for the company to achieve the said position in the market so cheaply and quickly without the insight and the customer data that the clubcard of Tesco facilitated the company with. Research Questions and Hypotheses Research Questions How Tesco tends to execute its customer loyalty program? What is the importance of customer reward program in the success of Tesco? What is the attitude of the customers towards the Tesco Clubcard? What is the efficiency of Tesco Clubcard in keeping the customers loyal? What improvements Tesco need to make in its customer reward program? Hypotheses Null Hypothesis (H0): Customer reward program makes a significant positive impact on the loyalty of the customers towards the company. Alternative Hypothesis (H1): Customer reward program does not make a significant positive impact on the loyalty of the customers towards the company. Operational Definition and Measurement The study would involve investigating the relationship and impact of the variables involved in the study. The variables include the dependent and the independent variable. The dependent variable includes the customer reward program and the Tesco Clubard and the dependent variable include the customer loyalty and success of Tesco. Research Methodologies: Data Collection and Analysis Sampling Techniques In the present study, the researcher would strive towards collecting both the primary and secondary data to gain an understanding of the impact of customer reward program on customer loyalty in case Tesco PLC. The online sources like peer reviewed articles and journals and early researches published online and offline sources like library, newspapers and business magazines would be used for the collection of the secondary data (Cooper and Schindler, 2010). The primary data would be both qualitative and quantitative data. The qualitative data would be collected with the help of the interview with the managers of Tesco and quantitative data would be collected by conducting survey with the customers. The managers for interview would be selected through non-probabilistic technique since their participation would depend upon their busy schedule and the customers for survey would be selected through probabilistic technique which would provide equal opportunity to the participants to participate in the survey (Crowther and Lancaster, 2012). Managers: 4 Customers: 80 5.2 Methods of Analysis The qualitative data would be analyzed and presented in a subjective manner and the quantitative data would be presented with the help of statistical tools and techniques like the charts, graphs, tables and pie chart and it would be analyzed with the help of the SPSS software (Saunders et al., 2009). Research Process Expected Outcomes It is expected that the study would put forward the fact that customer reward program like Tesco Clubcard tends to make a significant impact on the loyalty of the customers towards the marketer i.e. Tesco. Conclusion It can be concluded that the researcher in order to analyze the efficiency of reward program in enhancing customer loyalty would abide by the above discussed methods and process in order to achieve the research aim and objectives. References Cooper, D. and Schindler, P. S. (2010) Business Research Methods, 11th ed. London: McGra-Hill. Crowther, D. and Lancaster, G. (2012). Research Methods, 2nd ed. London: Routledge. Humby, C., Hunt, T. and Phillips, T. (2003). Scoring Points: How Tesco is winning customer loyalty. Kogan Page, London Hardback ISBN 07494, 272 pages. Strat. Change, 12(7), pp.403-404. McCall, M. and McMahon, D. (2015). Customer Loyalty Program Management: What Matters to the Customer. Cornell Hospitality Quarterly, 57(1), pp.111-115. Plimmer, G. (2010). Scoring points: How Tesco continues to win customer loyalty. Journal of Revenue and Pricing Management, 9(4), pp.377-378. Saunders, M. N., Lewis, P. and Thornhill, A. (2009) Research methods for business students, Page 52, 5th ed. Harlow: Prentice Hall Shin, J. and Sudhir, K. (2011). Managing Customer Relationships under Competition: Punish or Reward Current Customers?. SSRN Electronic Journal. Stone, M. (2003). Scoring Points: How Tesco is Winning Customer Loyalty. Journal of Database Marketing Customer Strategy Management, 11(2), pp.185-187. Tesco plc. (2015). Tesco PLC: Business and its Approach to Win Customer Loyalty. [online] Available at: https://www.tescoplc.com [Accessed 23 Aug. 2016].